Warner Norcross + Judd LLP serves as legal counsel to the City of Bay City, Michigan. Earlier this week, the city commission for Bay City approved several agreements between the city and United Bridge Partners under which UBP would rehabilitate two city-owned drawbridges that span the Saginaw River.
Under terms of the agreements, UBP, through its subsidiary Bay City Bridge Partners, will complete bridge rehabilitation at an estimated cost of $150 million. BCBP will then implement tolling to cover costs associated with the rehabilitation as well as ongoing operation and maintenance, of the Independence and Liberty bridges.
Considered to be the first of its kind of public-private partnership in Michigan, the complex lease agreements required approvals from the Federal Highway Administration, Michigan Department of Transportation and other state and local authorities. Along the way, the city team received input from multiple stakeholders, including Bay City residents and businesses that are the primary users of the bridges.
“This innovative P3 project is the culmination of a seven-year effort to ensure an appropriate and effective funding mechanism is in place for the long-term viability of the bridges and the safety of those who use them,” said Kurt M. Brauer, a Warner partner who co-led the effort. “We congratulate the city commission of Bay City which used an open and transparent process to reach this landmark agreement that provides both immediate and long-term benefits to the community, and paves the way for other Michigan municipalities to access private funding to address costly infrastructure needs.”
As the country faces a massive backlog of critical infrastructure needs, and as federal, state and local governments often lack sufficient resources to properly rehabilitate and maintain infrastructure, public-private partnerships are seen as a viable funding alternative that minimizes impact to taxpayers and helps stabilize municipal budgets. Yet the practice is still relatively new. During the Bay City due diligence period, Warner’s Government Affairs Practice Group played a significant role in facilitating Senate Bills 1215 through 1218, which were the first to allow a Michigan city to enter into a public-private agreement for a public bridge facility and to apply tolls to pay for the improvements.
“This is an incredibly complex agreement that was made even more challenging by the fact this type of P3 project had never been undertaken in Michigan before,” said William C. Lentine, Warner partner and co-lead on the project. “What ultimately got us over the finish line was a commitment by all parties to collaborate and a focus on creative problem-solving.”
The Liberty Bridge, originally constructed in 1864 as a wood structure, is set to reopen on Dec. 22 after having undergone extensive renovations using the latest in bridge technology. The Independence Bridge, originally scheduled for replacement, will be rehabilitated and modernized with construction beginning in 2023.
“Although the bridges are straight, it’s been a long and winding road to reach this point,” said Bay City Manager Dana Muscott. “We started this process knowing these bridges were in serious disrepair, but not knowing how to fund renovations when the city has so many competing infrastructure needs. I’m proud of the work from our city commissioners, Warner Norcross + Judd attorneys and Bay City Bridge Partners, who collaboratively bridged the gaps and reached this successful conclusion.”
Members of the Warner’s Infrastructure and Public-Private Partnership Industry Group provided legal counsel on a range of matters across construction, environmental, real estate, governmental affairs, tax, finance and administrative law. The Warner team was co-led by Brauer (environmental law and economic incentives) and Lentine (tax and corporate), and supported by David W. MacDonald (real estate), Daniel P. Ettinger (resources and environmental), Monique C. Field-Foster and Troy Cumings (government affairs), Sarah A. Harper (corporate and financial incentives), Andrew M. Reside (corporate and real estate) and Scott M. Carter (corporate).
Warner's Economic Incentives Group has secured more than $1 billion in federal and state grants, credits and other incentives to push redevelopment and public-private projects forward to completion. The firm also serves as the U.S. legal advisor to the Windsor-Detroit Bridge Authority on the $4.4 billion Gordie Howe International Bridge project that has been recognized with several national and international P3 awards.
About Warner
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